Current through Register Vol. 47, No. 13, December 25, 2024
(1)
Loan agreements. The
authority will prepare a loan agreement when the application has been
determined to be in compliance with the requirements of the CWA/SDWA and
applicable state rules for SRF funding. The loan shall be accompanied by an
enforceability opinion in a form acceptable to the authority and, if
applicable, a bond counsel opinion as to the status of interest on the
obligation, in a form acceptable to the authority. A copy of the current form
of the loan agreement shall be provided to the applicant upon
request.
(2)Loan rates and
terms. Loan terms for point source projects shall include the
following:
a.
Interest rates.
Loan interest rates shall be established in the IUP and shall be established by
taking into account factors including, but not limited to, the following:
(1) Interest rate cost of funds to the
SRF;
(2) Availability of other SRF
funds;
(3) Prevailing market
interest rates of comparable non-SRF loans; and
(4) Long-term SRF viability.
b.
Loan initiation
fee. The loan initiation fee shall be established in the IUR The fee
shall be payable on the closing date of the loan agreement.
c.
Annual loan servicing
fee. The annual loan servicing fee shall be established in the
IUR
d.
Revenue
pledge. The recipient shall establish sufficient revenue sources that
are acceptable to the director for the repayment of the loan. To ensure
repayment of obligations according to the terms of the loan agreement, the
recipient shall agree to impose, collect, and increase, if necessary, user
charges, taxes, or other dedicated revenue sources identified for the loan
repayment in order to maintain annual net revenues at a level equal to at least
110 percent of the amount necessary to pay debt service on all revenue
obligations during the next fiscal year, provided, however, that, at the
discretion of the director, the authority may allow other revenue sources and
coverage of less than 110 percent as security. In case of loan default, the
authority shall have authority to require revenue adjustment, through the
manner described above, to collect delinquent loan payments.
e.
Security. The loan shall
be secured by a first lien upon the dedicated source of repayment which may
rank on a parity basis with other obligations. The dedicated source of
repayment is expected to be the net revenues of the recipient's system and the
loan is expected to be secured by a first lien on said net revenues. Loans
secured by revenues of a system may rank on a parity basis with other
outstanding obligations or, with the approval of the director, may be
subordinate in right of payment to the recipient's other outstanding revenue
obligations. Loans may also be secured by a general obligation of the recipient
through the provision for a levy of taxes to repay the loan.
f.
Construction payment
schedules. An estimated construction drawdown schedule provided by the
recipient shall be part of the loan agreement.
(3)
Loan commitments. A loan
agreement shall be a binding commitment of the recipient.
(4)Purpose of payments. The
recipient shall use the proceeds of the WPCSRF/DWSRF loan solely for the
purpose of funding the approved project.
(5)Costs. All eligible costs
must be documented to the satisfaction of the authority and the department
before proceeds of the loan will be disbursed.
(6)Loan amount and repayment
period. All loans shall be made contingent on the availability of
funds, the maximum loan term will be that allowed by EPA, and repayment of the
loan must begin no later than one year after the project is completed or by the
date specified in the loan agreement.
(7)Prepayment. The loan may
be prepaid, in whole or in part, on any date with the prior written consent of
the authority.
